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The Curious Case of Football Contracts

 The Curious Case of Football Contracts

I’ve had it with your negative comments, I can’t take it. I quit!

Still here? Why? I quit didn’t I? Oh, that’s right I’m on one of those football contracts, the most bizarre of conventions in modern sports. Of course fixed term contracts are not unique to football but in what other profession except as an athlete are you forced to work for an employer you don’t want to?

Over the years Contracts in football have become increasingly convoluted and complicated. It initially began with a system whereby professional football players had to be registered with a particular club for a season before they could play. As the game became more popular so did the players who soon leveraged their personal appeal to sign annual contracts with a club of their choosing, giving themselves the option to sign with a new club the following season if they could get more money.

The problem with the above system was obvious, the bigger (and therefore richer) clubs could offer better contracts and would result in a system where there was a clear divide between the haves and the have nots. So in 1893 the FA implemented the ‘Retain & Transfer‘ system, where a player could only register with one club and then could not register with another without the permission of his current club. Soon clubs realised they could charge for the release of a player and thus the transfer system was born.

Since the inception of that system Football then had become a very moderate and widely accepted form of serfdom. As players can be forced into play for a club they don’t want to or be forced out of the game and a change was not implemented until 60 years and two world wars later.

The following quote from a famous footballer sums up the development:

“Our contract could bind us to a club for life. Most people called it the “slavery contract”. We had virtually no rights at all. It was often the case that the guy on the terrace not only earned more than us — though there’s nothing wrong with that — he had more freedom of movement than us. People in business or teaching were able to hand in their notice and move on. We weren’t. That was wrong.”
- George Eastham

The first successful challenge of the ‘Retain & Transfer’ system was made in 1963 as the High Court in England heard the case of Eastham V Newcastle United. In this case the player told Newcastle that at the end of his contract he no longer wanted to play for them and requested a transfer, a request that was refused. Eastham went on strike and found alternative employment because he could not play elsewhere. He eventually received his transfer but took the club (and the system) to the high court where the judge forced the Football League to change it’s system the retain element was removed but the transfer system remained.

As the game has increased it’s reach so have the governing bodies. You may have noticed that the case of Eastham above is startlingly similar to the much more famous case of Jean-Marc Bosman which changed the face of football transfers in 1995 which previously had prevented the transfer of players between European Countries on expiration of contracts forcing the player to stay in country. I won’t bore you with why (free movement of workers) just that the Bosman case rocked European football and put more power in the player’s hands who could simply sit on their hands if unhappy and wait to move anywhere in Europe at contracts end.

Of course since then UEFA has continually tried to place the power back with the clubs particularly the protection of smaller clubs from having their best youth players picked up for nothing at contracts end. However with such regulation comes bizarre irregularities whereby Dan Gosling was allowed to leave Everton for nothing despite having a better contract offered to him simply because it wasn’t in writing, this cost Everton millions and prevented Plymouth (his youth team) from gaining any sell-on money.

More recently there has been the ‘Webster Ruling’ whereby player’s themselves could buy the remainder of their contract and move clubs. The ruling was described as giving “footballers the sort of employee rights that anyone else would expect in the workplace“. However it’s use has not been as widespread as the Bosman ruling, the rumours are rife that a gentleman’s agreement exists between clubs not to exploit the ruling.

So there we have it, some of the vagaries of the Contract system laid bare, are you any wiser? I think not and the central point still remains, footballers are still tied to a club for an determined period; that is as long as a breach of contract is not made (see Adrian Mutu and Marlon King). They may have agreed to it initially but anything can happen in several years, for instance Leeds or Juventus.

Eastham’s ‘slavery’ comments has since been repeated since by the much less reputable Sepp Blatter, of course if Sepp agrees with you there must be something wrong. So what is wrong with all this complaining? The players themselves, naturally. The important thing about Eastham’s comments were that football was not a full-time job and had to be supplemented with another wage. Nowadays players complaining about ‘slavery’ need only be pointed to their bank account to sway that opinion.

Also players are not exempt from exploiting their guaranteed term as well, the most famous of these players would be Winston Bogarde whose excessive contract allowed him to earn money for basically nothing (no league appearances in his final 3 seasons).However the top levels are not representative of the entire game, many young player’s need the option to move on from their home-town clubs at the end of contracts inexpertly drawn up and signed. Or whenever your team cannot afford to pay you but because you are between ‘transfer windows’ you have no choice but to play on in the hope of payment. Think of the poor Dundee players whose jobs could disappear and they have to wait to register with another club.

Contracts are a big part of football, they usually determine the fee which is paid for a player i.e. those on a long-term deal are more expensive than those who will be leaving soon (see Niko Kranjcar’s pitiful fee) and they continue to get more convoluted leading to ugly court cases that detract from the sport as a whole. The entire Jon Obi Mikel transfer was a farce from which his career has mercifully eclipsed. In Europe the meddling of the EU will prevent wholesale changes to the system (such as the introduction of a Salary Cap).

However it is not all doom and gloom, football has managed to avoid season and reputation destroying strikes, unlike MLB whilst also avoiding the free-for-all of free agency which can be borderline shameful, unlike the NBA and ‘The Decision’. The fact still remains that sports and prominently Football exist inside a legal bubble in terms of Employment, you simply cannot say ‘I quit’ with any conviction and can be kept in employment against your wishes.

So no, I don’t quit, you aren’t rid of me that easily and look! An entire contract article that doesn’t mention Wayne Rooney.

Damnit!

Finally on a personal note, if you enjoy my writing which has included the articles hotlinked to these words and you have the disposable time then could you vote for me on part 5 at the Not 100% Football Blogger Awards. You can also follow me @kipp9 on twitter.

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19 Responses to The Curious Case of Football Contracts

  1. gary says:

    if you’re talking about Dundee players who COULD have their contracts terminated, that’s one thing. but if you’re saying that the Dundee players who HAD their contracts terminated in administration can’t move anywhere until the transfer window opens, I find that very hard to believe. I thought that free agents are not bound by the transfer window…..

    • Chris McQuade says:

      The top leagues stop free transfers on deadline day. Lower leagues can continue to sign unsigned players until November. However those are ‘unregistered’ players. These players who are registered to Dundee and have played are tied up until January 1st. See Sol Campbell and Notts County.

      • Dave C says:

        That’s not right. Top leagues CAN sign free agents at any point during the season, as long as that player was a free agent ever since the previous transfer window.

        i.e. you can’t leave a club in October and join a different club on a free transfer. But if you’re out of contract during the summer window, and no-one picks you up, you can sign for a club in Oct, Nov or whatever (although obviously at the top end this is relatively rare).

        • Chris McQuade says:

          Fairly sure you can’t, you can’t in FM and it’s generally very good on rules.

          I am open to being wrong though.

          • Dave C says:

            FM??? The video game? It may be pretty good with a lot of details, but I wouldn’t treat it as the authority on any matter.

            I’m VERY sure free agents are allowed to sign at any point in the year, providing they were a free agent during the previous window (unless some new rule has been introduced during the last year). For example, prior to last season, Steven Appiah was released by Juventus. No-one picked him up during the transfer window, but as the season continued, there were various media rumours suggesting he might join various clubs. The transfer rumours at the time always made a point of mentioning that as a free agent, he could sign at ANY point in the season.

          • Dave C says:

            I tried replying to this point already, but for some reason it got “held for moderation.” I can’t imagine why, since it was only discussing the rather dry matter of contract-law, not really much scope for offense there. (Possibly because I used two consecutive question marks, so I flagged some kind of snarky-meter?).

            Anyway, my point was that Steven Appiah left Juventus prior to last season, and transfer rumours in the press frequently linked him to premier league team during the season. I specifically remember hearing that because he was a free agent during the previous window, as an unnatached free-agent he could still sign for a new club at any point in the season.

  2. Matt T. says:

    I’ve seen the phrase “leaving on a Bosman” and I’ve also seen free transfer. What’s the difference? Is there a difference?

    • Chris McQuade says:

      You can declare that you are leaving on a bosman 6 months prior to your contract end. You are then free to negotiate with another club with your current club having no recourse to stop you. Come the end of your contract you automatically transfer to your chosen club. Leaving on a free means that your contract was not renewed and you may sign with anyone. The difference is when you can negotiate. Technically Gosling left on a free. If it were a bosman – that is Newcastle agreed before his contract was up- he would have left on a Bosman and due to new rules Everton would’ve been due compensation.

      Any Clearer?

    • Paul says:

      Don’t forget that there are also free transfers which are not at the end of the contract. If the “selling” team no longer wants to pay your wages and another “buying” team wants that player’s services both teams can agree to a transfer for zero dollars (a free transfer) if the new team can offer terms acceptable to the player.

  3. Dave C says:

    Weird article. There are some inherent oddities in football contracts, but the article doesn’t address much of that, and instead take the approach that the idea of a contract itself is particularly unusual:

    “Of course fixed term contracts are not unique to football but in what other profession except as an athlete are you forced to work for an employer you don’t want to?”

    Fixed term contracts are fairly common outside of football. Off the top of my head, I can think of positions like in academia and other public sector jobs that may have a fixed term due to funding requirements. Also, a contract for a fixed time period is really no different to a contract for a fixed service – eg hiring a builder to offer an agreed service (i.e. building a house) is no different to hiring a footballer to provide the agreed service of playing football (although in this case the service is measured in terms of # of seasons played).

    And no-one is forced to work for an employer they don’t want to – you make the choice to sign the contract (presumably because you DO want to work for that employer). If you subsequently change your mind, that’s a different matter – you can terminate the contract, but face whatever penalties were agreed upon in the contract. But likewise, this protects the worker too, since the employer cannot change their mind without facing whatever consequences were written into the contract.

    “I think not and the central point still remains, footballers are still tied to a club for a determined period”. Well that’s the whole point, and likewise the clubs are obliged to pay the footballers for that period too (unless there are specific grounds for termination). The whole point of a contract is that it’s a formal agreement between two parties, for the benefit and protection of both parties.

    • Chris McQuade says:

      Academia is one I hadn’t thought of, however for it and the public sector you can resign, serve your notice and leave. In sports you may not as you and your contract are a commodity. Fixed service contract is interesting, you pay a football player to do one thing, play football. If you were to pay a builder and he did a terrible job you have recourse, in Football there is no recourse just a horrible contract.

      Finally I get why, I just struggle with the legal bubble sport has placed entrenched itself in. Players are denied rights every another worker is provided, statutorily. It’s odd.

      • Dave C says:

        I think now we’re talking about the REAL oddities of football contracts.

        In terms of players being denied the rights afforded to other workers (i.e. the right to hand in your notice and leave without reason), I think we could say they signed away that right when they agreed to the contract. I’m not a legal expert, and I know there are some legal rights that you cannot legally forfeit, so maybe anyone with any actual expertise in contract law could weigh in on that. In effect, I’m saying that in exchange for a hefty salary, the player has agreed that he will not simply hand in his notice and walk away.

        Now as to to WHY this is the case in football, but not academia, the public sector or whatever, I would say it is due to the “replaceablility” of the worker, and the competition amongst other employers. For example, imagine the case of a professor at a university. Maybe the university could create a clause in his contract stating that he could NOT walk away until the end of the contract. But they would likely not do that, since (a) other universities would offer him a similar contract WITHOUT such a clause, hence he would take their offer instead, (b) it’s not worth the hassle, since even if he was to take the job and then hand in his notice and leave, the university can always hire a replacement professor fairly easily (unless he’s of the stature of Stephen Hawkins etc).

        In football, the players forego this right to walk away during the contract because that’s what ALL clubs would put in their contract. There isn’t a competing club that would offer a similar contract BUT include the right to simply hand in your notice and leave. And the reason that no club would do this is because the players are less replaceable. If C Ronaldo was to hand in two-weeks notice and walk away, Real Madrid couldn’t find a replacement very easily, given that his talents are almost unique.

        Now you might say “well if EVERY club allowed players the right to serve their notice and leave, their would be greater liquidity (ease of movement) in football’s labor market, and hence the replaceability would not be such a big deal (because if C-Ron left, Real could simply offer a big deal to Messi and bring him in instead etc etc).”

        But I think the key thing here is that football NEEDS a limit to the liquidity of its labor force to preserve the fairness of the competitions, and thus to maintain the public’s interest in the sport (for its own survival). If players could simply hand in their notice and move on in two weeks like the rest of us, teams would be in a constant state of flux as players shuffled around for the next big pay check. And I think people would pretty quickly lose interest in the game at the top levels.

        • Dave C says:

          Sorry the last post was so long by the way – it can be hard to talk about fairly complex/abstract issues in a concise way!

          Another point that I find interesting is what you mentioned about builders doing a horrible job. I think this highlights the subjectivity involved in football. If a builder does a terrible job, you can objectively demonstrate WHY – perhaps he failed to build to the agreed blue-prints, or his materials were demonstratably not up to specifications, or his workmanship did not meet industry standards/building codes etc. Thus it would be easy to find grounds to cancel the contract.

          Football on the other hand is much more subjective. If a player simply plays badly, he can’t be “fired.” I imagine this is the reason why guys like Winston Bogarde could continue to pick up a paycheck despite never playing. As long as he came to training each day, maintained his fitness, and theoretically made himself available for selection, his club had little recourse.

          “In sports you may not as you and your contract are a commodity.”

          This is also an interesting idea – from an accounting point of view I believe it’s not entirely accurate (I have some limited accounting knowledge, so I would appreciate if any one else out there can chip-in with some clarification). As far as I know, the “transfer-value” of a player CANNOT be put on the club’s balance sheet as an asset. (although obviously in layman’s terms, the players are effectively commodities/assets).

  4. Dave C says:

    And just to be a little constructive, when I say there are inherent oddities in football contracts, I mean things like the following:

    1) Players can force a move by claiming to be no longer entirely motivated to play for their current team. This twists the management’s arm, because if a player is “unmotivated” or “not up for it” he won’t “give 110%”, so they essentially have to grant him his wish and sell him. In no other contract can you basically hint that you can no longer be bothered to fulfill your side of the bargain, and thus be allowed to walk away without any penalty.

    On the flip side, a clearly unmotivated player (such as Winston Bogarde) can cleary sit around and pick up his wages every week. But the club can’t fire him, because as long as he’s coming into training each day, he’s not in breach of the contract (i.e. you can’t prove someone is “not up for it”).

    2) The other oddity is that regardless of what a player and club-owner might agree to in a contract, whether the manager selects the player or not is entirely up to the manager’s discretion. Thus, due to a personal falling out, a player may be dropped for a whole season (or longer). Although he’s still getting a paycheck, it seems unfair that a player can be retained in this way if he’s not getting a chance at actually playing games.

  5. Jon says:

    Hi Chris,

    I am with Dave C. on both of his comments above. I’m not sure you’ve really fairly explored the legal issues in football contracts in a particularly clear or objective way.

    Ultimately, there are elements of contracts in football that favour players, but also aspects that favour clubs. This is true for entire history of the law of contract in the common-law world. The law is constantly developing to adapt to the shift in power between parties in a contractual relationship. For example, employment contracts used to heavily favour employers over employees before the development of the unconscionabilty doctrine in common law contracts. There have also been various statutes passes over time to place limits on contractual terms or require certain contractual terms (minimum wage, for example, maximum work hours in a day or week, anti-discrimination provisions in tendering contracts).

    The two things that are worth commenting on are where you see the balance, as it currently lies (and I’m not clear on where you fall in your post) and whether that is good or bad, and also particular vagaries of football contracts that shift the balance in one way or another that is different from any other employment contract, like Dave C. did in his second post above.

    Cheers,

    Jon

    • Chris McQuade says:

      Good points, I think the EU and their directives over freedom of work have had the biggest shake ups in terms of footballers and their contracts. Bosman and Webster have seen the European Courts impose equitable measures for workers in their right to seek alternative employment whilst also recognising that the contract itself must be sacrosanct for an Arbitrary time period.

      It seems that the whole system is now an enforced compromise that is starting to get strange.

  6. I read an interesting article in a national paper today that centered around the thoughts of Liverpool’s new owners and their disappointment that older Liverpool players were on long contracts on large money, players such as Carragher, Mazi and Konchesky were mentioned. They want to follow the Arsenal or United model of paying premiums for young players with re sale value

  7. Pakapala says:

    “Of course fixed term contracts are not unique to football but in what other profession except as an athlete are you forced to work for an employer you don’t want to?”

    Well 1 is not forced to work for the employer you don’t want to. You can always decide to breach your contract; gotta be prepared to deal with the consequences though.
    As for other professions like that? Well just about the whole entertainment industry (movie, music, sports, etc) is more or less based on similar contracts.

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